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PNC Financial Q3 Earnings Beat Estimates on Higher NII, Revenue Miss
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Key Takeaways
PNC's adjusted Q3 EPS rose 17% y/y to $5.09, beating estimates, while revenues grew 10.9% to $6.56B.
NII climbed 15.3%, loans grew 16%, while the efficiency ratio fell to 57% y/y in Q3.
PNC raised 2026 loan and NII growth outlooks, but net loan charge-offs jumped 43.6% y/y.
The PNC Financial Services Group, Inc. (PNC - Free Report) has delivered adjusted earnings per share of $5.09 in the third quarter of 2026, beating the Zacks Consensus Estimate of $4.97. The bottom line increased 17% from $4.35 in the year-ago quarter.
Results reflected higher net interest income (NII), solid loan and deposit growth and improved operating efficiency. However, higher expenses and increased net loan charge-offs were headwinds.
Results excluded FirstBank integration costs and certain significant items. After considering those, net income (GAAP basis) was $2.10 billion, up 15.1% from the year-ago quarter.
PNC Financial's Revenues & Expenses Rise
Quarterly revenues were $6.56 billion, up 10.9% year over year. The top line missed the Zacks Consensus Estimate of $6.60 billion.
NII rose 15.3% year over year to $4.21 billion, benefiting from commercial loan growth, the FirstBank acquisition and lower funding costs. The company's net interest margin (NIM) improved to 2.94%, expanding 15 basis points year over year.
Non-interest income totaled $2.36 billion, up 3.9% from the third quarter of 2025. Within fee income categories, asset management and brokerage revenues increased 10.6%, card and cash management revenues rose 4.3%, and lending and deposit services revenues grew 6.9%. Capital markets and advisory revenues remained relatively stable, while residential and commercial mortgage revenues declined 16.1%.
Non-interest expenses increased 8.4% year over year to $3.75 billion. The rise reflected continued investments to support business growth and the addition of FirstBank operating expenses.
The efficiency ratio fell to 57% from 59% in the year-ago quarter. A decline in the efficiency ratio indicates rising profitability.
PNC's Loan & Deposit Balances Increase
Total loans increased 16% year over year to $378.8 billion as of Sept. 30, 2026, driven by commercial loan growth and the addition of FirstBank loans. Average loans grew 14% year over year to $372.2 billion.
Total deposits rose 7.8% year over year to $466.4 billion, reflecting growth in commercial interest-bearing deposits, new and expanded client relationships, and the FirstBank acquisition. Average deposits increased 6.8% year over year to $461.2 billion.
PNC's Credit Quality Deteriorates
Total non-performing loans were $2.19 billion, up 2.7% from the year-ago quarter. However, the non-performing-loans-to-total-loans ratio declined to 0.58% from 0.65% a year ago.
Net loan charge-offs were $257 million, up 43.6% from the year-ago quarter. The figure included $35 million related to the transfer of the student loan portfolio to held-for-sale. The net charge-offs to average loans ratio was 0.28%, up from 0.22% in the prior-year quarter.
The company reported a provision for credit losses of $189 million, up 13.2% year over year. The allowance for credit losses increased to $5.4 billion from $5.3 billion as of Sept. 30, 2025. However, the allowance for the credit-losses-to-total-loans ratio declined to 1.42% from 1.61% in the year-ago quarter.
PNC's Capital Position & Profitability Ratios
As of Sept. 30, 2026, the Basel III common equity tier 1 capital ratio was 9.8% compared with 10.7% as of Sept. 30, 2025.
Return on average assets and average common shareholders' equity were 1.32% and 13.89%, respectively, compared with 1.27% and 13.24% in the year-ago quarter.
PNC's Capital Return Stays Robust
In the third quarter of 2026, PNC returned $1.4 billion of capital to shareholders. This included $0.8 billion in common stock dividends and $0.6 billion in common share repurchases. The company expects share repurchase activity in the fourth quarter of 2026 to be in line with the third-quarter level.
PNC also declared a quarterly common stock dividend of $2 per share compared with $1.70 in the year-ago quarter.
PNC Raises 2026 Financial's Guidance
For 2026, the company raised its average loan growth outlook to 13.5% from the previously stated 12.5%.
PNC also raised its NII growth outlook to 15.5% from the prior mentioned 15-15.5%. The company expects non-interest income and total revenues to increase 10.5% and 13.7%, respectively, compared with the earlier mentioned 9% and 13%.
The company raised its non-interest expense growth expectation, excluding integration costs and significant items, to 9.5% from 8.5%, while maintaining its effective tax rate outlook of 19.5%.
Our View on PNC
PNC Financial's strong commercial loan growth, higher NII, expanding year-over-year NIM and improving operating efficiency are likely to support its financial performance. The company's diversified businesses, growing client relationships and the FirstBank acquisition provide opportunities for sustained revenue growth.
The bank's capital position and profitability also support continued shareholder returns. However, higher net loan charge-offs and increasing funding costs remain concerning. Moreover, volatility in capital markets-related revenues could weigh on the near-term performance.
The PNC Financial Services Group, Inc Price, Consensus and EPS Surprise
Truist Financial (TFC - Free Report) is slated to announce third-quarter 2026 results on Oct. 16.
Over the past seven days, the Zacks Consensus Estimate for TFC’s quarterly earnings has been unchanged at $1.17. The figure implies 12.5% growth from the prior-year quarter’s actual.
KeyCorp (KEY - Free Report) is slated to announce third-quarter 2026 results on Oct. 20.
Over the past seven days, the Zacks Consensus Estimate for KEY’s quarterly earnings has been unchanged at 46 cents. The figure implies 12.2% growth from the prior-year quarter’s actual.
View the Zacks #1 Rank List
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PNC Financial Q3 Earnings Beat Estimates on Higher NII, Revenue Miss
Key Takeaways
The PNC Financial Services Group, Inc. (PNC - Free Report) has delivered adjusted earnings per share of $5.09 in the third quarter of 2026, beating the Zacks Consensus Estimate of $4.97. The bottom line increased 17% from $4.35 in the year-ago quarter.
Results reflected higher net interest income (NII), solid loan and deposit growth and improved operating efficiency. However, higher expenses and increased net loan charge-offs were headwinds.
Results excluded FirstBank integration costs and certain significant items. After considering those, net income (GAAP basis) was $2.10 billion, up 15.1% from the year-ago quarter.
PNC Financial's Revenues & Expenses Rise
Quarterly revenues were $6.56 billion, up 10.9% year over year. The top line missed the Zacks Consensus Estimate of $6.60 billion.
NII rose 15.3% year over year to $4.21 billion, benefiting from commercial loan growth, the FirstBank acquisition and lower funding costs. The company's net interest margin (NIM) improved to 2.94%, expanding 15 basis points year over year.
Non-interest income totaled $2.36 billion, up 3.9% from the third quarter of 2025. Within fee income categories, asset management and brokerage revenues increased 10.6%, card and cash management revenues rose 4.3%, and lending and deposit services revenues grew 6.9%. Capital markets and advisory revenues remained relatively stable, while residential and commercial mortgage revenues declined 16.1%.
Non-interest expenses increased 8.4% year over year to $3.75 billion. The rise reflected continued investments to support business growth and the addition of FirstBank operating expenses.
The efficiency ratio fell to 57% from 59% in the year-ago quarter. A decline in the efficiency ratio indicates rising profitability.
PNC's Loan & Deposit Balances Increase
Total loans increased 16% year over year to $378.8 billion as of Sept. 30, 2026, driven by commercial loan growth and the addition of FirstBank loans. Average loans grew 14% year over year to $372.2 billion.
Total deposits rose 7.8% year over year to $466.4 billion, reflecting growth in commercial interest-bearing deposits, new and expanded client relationships, and the FirstBank acquisition. Average deposits increased 6.8% year over year to $461.2 billion.
PNC's Credit Quality Deteriorates
Total non-performing loans were $2.19 billion, up 2.7% from the year-ago quarter. However, the non-performing-loans-to-total-loans ratio declined to 0.58% from 0.65% a year ago.
Net loan charge-offs were $257 million, up 43.6% from the year-ago quarter. The figure included $35 million related to the transfer of the student loan portfolio to held-for-sale. The net charge-offs to average loans ratio was 0.28%, up from 0.22% in the prior-year quarter.
The company reported a provision for credit losses of $189 million, up 13.2% year over year. The allowance for credit losses increased to $5.4 billion from $5.3 billion as of Sept. 30, 2025. However, the allowance for the credit-losses-to-total-loans ratio declined to 1.42% from 1.61% in the year-ago quarter.
PNC's Capital Position & Profitability Ratios
As of Sept. 30, 2026, the Basel III common equity tier 1 capital ratio was 9.8% compared with 10.7% as of Sept. 30, 2025.
Return on average assets and average common shareholders' equity were 1.32% and 13.89%, respectively, compared with 1.27% and 13.24% in the year-ago quarter.
PNC's Capital Return Stays Robust
In the third quarter of 2026, PNC returned $1.4 billion of capital to shareholders. This included $0.8 billion in common stock dividends and $0.6 billion in common share repurchases. The company expects share repurchase activity in the fourth quarter of 2026 to be in line with the third-quarter level.
PNC also declared a quarterly common stock dividend of $2 per share compared with $1.70 in the year-ago quarter.
PNC Raises 2026 Financial's Guidance
For 2026, the company raised its average loan growth outlook to 13.5% from the previously stated 12.5%.
PNC also raised its NII growth outlook to 15.5% from the prior mentioned 15-15.5%. The company expects non-interest income and total revenues to increase 10.5% and 13.7%, respectively, compared with the earlier mentioned 9% and 13%.
The company raised its non-interest expense growth expectation, excluding integration costs and significant items, to 9.5% from 8.5%, while maintaining its effective tax rate outlook of 19.5%.
Our View on PNC
PNC Financial's strong commercial loan growth, higher NII, expanding year-over-year NIM and improving operating efficiency are likely to support its financial performance. The company's diversified businesses, growing client relationships and the FirstBank acquisition provide opportunities for sustained revenue growth.
The bank's capital position and profitability also support continued shareholder returns. However, higher net loan charge-offs and increasing funding costs remain concerning. Moreover, volatility in capital markets-related revenues could weigh on the near-term performance.
The PNC Financial Services Group, Inc Price, Consensus and EPS Surprise
The PNC Financial Services Group, Inc price-consensus-eps-surprise-chart | The PNC Financial Services Group, Inc Quote
Currently, PNC carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Release Dates of Other Banks
Truist Financial (TFC - Free Report) is slated to announce third-quarter 2026 results on Oct. 16.
Over the past seven days, the Zacks Consensus Estimate for TFC’s quarterly earnings has been unchanged at $1.17. The figure implies 12.5% growth from the prior-year quarter’s actual.
KeyCorp (KEY - Free Report) is slated to announce third-quarter 2026 results on Oct. 20.
Over the past seven days, the Zacks Consensus Estimate for KEY’s quarterly earnings has been unchanged at 46 cents. The figure implies 12.2% growth from the prior-year quarter’s actual.